[Federal Register Volume 65, Number 237 (Friday, December 8, 2000)]
[Rules and Regulations]
[Pages 76933-76935]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-30694]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010-AC66


Oil and Gas and Sulphur Operations in the Outer Continental 
Shelf--Update of Documents Incorporated by Reference--API Specification 
14A, Tenth Edition

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Final rule.

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SUMMARY: MMS is updating one document incorporated by reference in 
regulations governing oil and gas and sulphur operations in the Outer 
Continental Shelf (OCS). The new edition of this document incorporated 
by reference will ensure that lessees use the best available and safest 
technologies while operating in the OCS. The updated document, issued 
by the American Petroleum Institute (API), is API Specification 14A, 
Tenth Edition, November 2000, ISO 10432:1999, Petroleum and natural gas 
industries--Downhole equipment--Subsurface safety valve equipment, 
Stock No. G14A09.

DATES: This rule is effective January 8, 2001. The incorporation by 
reference of publications listed in the regulation is approved by the 
Director of the Federal Register as of January 8, 2001.

FOR FURTHER INFORMATION CONTACT: Fred Gray, Operations Analysis Branch, 
at (703) 787-1027.

SUPPLEMENTARY INFORMATION: We use standards, specifications, and 
recommended practices developed by standard-setting organizations and 
the oil and gas industry for establishing requirements for activities 
in the OCS. This practice, known as incorporation by reference, allows 
us to incorporate the provisions of technical standards into the 
regulations without increasing the volume of the Code of Federal 
Regulations (CFR). The legal effect of incorporation by reference is 
that the material is treated as if it was published in the Federal 
Register. This material, like any other properly issued regulation, 
then has the force and effect of law. We hold operators/lessees 
accountable for complying with the documents incorporated by reference 
in our regulations. The regulations found at 1 CFR part 51 govern how 
MMS and other Federal agencies incorporate various documents by 
reference. Agencies can only incorporate by reference through 
publication in the Federal Register. Agencies must also gain approval 
from the Director of the Federal Register for each publication 
incorporated by reference. Incorporation by reference of a document or 
publication is limited to the specific edition or specific edition and 
supplement or addendum cited in the regulations.
    The International Organization for Standardization (ISO) is a 
worldwide federation of national standards bodies (ISO member bodies). 
Founded in the mid-1940's, ISO is a non-profit agency based in Geneva, 
Switzerland, whose purpose is to promote the development of 
international standards and related activities to facilitate the global 
exchange of goods and services. The American National Standards 
Institute (ANSI) is the official United States member body to ISO.
    The work of preparing international standards is normally carried 
out through an ISO technical committee (TC). Each member body 
interested in a subject for which a TC has been established has the 
right to be represented on that committee. ANSI relies on various 
United States trade and industry associations, such as the API, for 
support on industry-specific standards. This standard was developed by 
ISO/TC 67, ``Materials, equipment and offshore structures for petroleum 
and natural gas industries.'' API has been appointed by ANSI to 
administer the US ISO/TC 67 delegation, known as the US Technical 
Advisory Group (US TAG). MMS has been an active participant in the US 
TAG since August 1998.
    This second edition of the international standard cancels and 
replaces the first edition (ISO 10432:1993) and includes the changes in 
the similar API standard, API specification 14A, Ninth Edition, 1994, 
and its supplement dated December 15, 1997. ISO 10432:1999 was released 
as a Final Draft International Standard (FDIS) on June 3, 1999. Voting 
to advance the FDIS to a full international standard occurred on August 
3, 1999, and the standard was published as an international standard in 
November 1999.
    ISO permits a national adoption of its international standards with 
or without the inclusion of regional-specific annexes to account for 
regional or local conditions. The API procedures to effect the adoption 
of this international standard with a regional annex included a 
balloting and comment period to ensure consensus among users, 
manufacturers, regulatory agencies, and other interested parties. API 
balloting of the international standard with U.S. annexes, including an 
annex addressing the API quality specification and an independent test 
agency, occurred on June 9, 2000, and the API version of the 
international standard was published in October 2000.
    This standard was formulated to provide the minimum acceptable 
requirements for subsurface safety valve (SSSV) equipment--the SSSV is 
a downhole safety device used to shut off flow of oil and gas in the 
event of an emergency. MMS views this important piece of equipment as 
the last opportunity to secure the well and/or prevent pollution of the 
environment. The standard covers SSSVs, safety valve locks, safety 
valve landing nipples, and all components that establish tolerances 
and/or clearances that may affect performance or interchangeability of 
the SSSV equipment.
    We currently incorporate by reference the ninth edition (July 1994) 
of API specification 14A, without Supplement 1. Until now, we have not 
included API Specification 14A, Supplement 1, in the documents 
incorporated by reference in our regulations. Among other things, API 
Specification 14A, Supplement 1, deleted a 3-year requalification test 
requirement for SSSVs.
    We have been involved in a series of meetings and discussions with 
oil and gas operating companies, representatives of oil and gas 
associations, equipment manufacturers, quality assurance auditors, 
independent third-party testing and research facilities, and MMS 
offshore inspectors to consider the relative merits of the 3-year 
requalification test requirement. We specifically requested public 
comment on the potential impacts of deleting the 3-year requalification 
testing requirement for SSSVs in the Notice of Proposed Rulemaking (65 
FR 9232) published in the Federal Register on February 24, 2000. 
Comments were also sought on the suitability of including an 
international standard among the documents incorporated by reference in 
our regulations.
    In response to our request for public comment on the 3-year 
requalification test requirement, we received five comments supportive 
of deleting the 3-

[[Page 76934]]

year requalification test requirement and two comments that did not 
support deletion of the 3-year requalification test requirement. 
Comments were received from three oil and gas associations, three 
equipment manufacturers, and one test agency. We have considered all 
the comments received in our analysis, and have determined that the 
newly issued API version of the international standard, which does not 
include a 3-year requalification test requirement, should be 
incorporated into the MMS regulations. Comments were also generally in 
favor of using the API standard in lieu of the international standard 
since the API standard contained the regionally specific annexes 
appropriate for OCS use.

Procedural Matters

    This is a very simple rule to update one document previously 
incorporated by reference. The addition of the new document, API 
Specification 14A, Tenth Edition, ISO 10432:1999, Petroleum and natural 
gas industries--Downhole equipment--Subsurface safety valve equipment, 
will not have a significant effect on any offshore lessee/operator 
(small or large). One entity, which serves as the only independent test 
agency for initial design verification testing and 3-year 
requalification testing, will be negatively affected by the deletion of 
the 3-year requalification test requirement. Four U.S. manufacturers, 
with six U.S. facilities manufacturing SSSVs, will benefit from the 
elimination of costs associated with the 3-year requalification test 
requirement.

Regulatory Planning and Review (Executive Order 12866)

    This document is not a significant rule and is not subject to 
review by the Office of Management and Budget under Executive Order 
12866.
    (1) This rule will not have an effect of $100 million or more on 
the economy. It will not adversely affect in a material way the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities.
    The rule would have no significant economic impact because the 
document does not contain any significant revisions that will cause 
lessees or operators to change their business practices. The document 
will not require the retrofitting of any facilities.
    (2) This rule will not create a serious inconsistency or otherwise 
interfere with an action taken or planned by another agency.
    (3) This rule does not alter the budgetary effects or entitlements, 
grants, user fees, or loan programs or the rights or obligations of 
their recipients.
    (4) This rule does not raise novel legal or policy issues.

Regulatory Flexibility Act (RF Act)

    The Department certifies that this document will not have a 
significant economic effect on a substantial number of small entities 
under the RF Act (5 U.S.C. 601 et seq.). The Small Business 
Administration (SBA) defines a small business as having:
     Annual revenues of $5 million or less for exploration 
service and field service companies.
     Fewer than 500 employees for drilling companies and for 
companies that extract oil, gas, or natural gas liquids.
    Incorporating the new document into MMS regulations would allow 
SSSVs with design verification approval to be manufactured and placed 
into service without the need for a requalification test every 3 years. 
Thus, incorporating the new document will not impose new costs on the 
offshore oil and gas industry but rather may reduce costs to the 
industry in that manufacturers of SSSVs will not incur the costs of a 
requalification test every 3 years.
    Incorporating the new document will also not impose new costs on 
the manufacturers of the offshore equipment, as previously stated. 
There are four U.S. companies that manufacture SSSVs for service on the 
OCS, none of whom could be classified as a small entity, who will 
benefit from cost savings attributable to the deletion of the 3-year 
requalification test requirement.
    The test agency that will be negatively affected by the deletion of 
the 3-year requalification test requirement is an independent, 
nonprofit, applied research and development organization. The test 
agency has recently reported annual revenues in excess of $300 million 
and employment of over 2500 staff. The test agency does not qualify as 
a small entity.
    The Department also determined that the indirect effects of this 
rule on small entities that provide other support functions for 
offshore activities are insignificant (in effect zero).
    Your comments are important. The Small Business and Agriculture 
Regulatory Enforcement Ombudsman and 10 Regional Fairness Boards were 
established to receive comments from small business about Federal 
agency enforcement actions. The Ombudsman will annually evaluate the 
enforcement activities and rate each agency's responsiveness to small 
business. If you wish to comment on the enforcement actions of MMS, 
call toll-free (888) 734-3247.

Small Business Regulatory Enforcement Fairness Act (SBREFA)

    This rule is not a major rule under 5 U.S.C. 804(2), SBREFA. This 
rule:
    (a) Does not have an annual effect on the economy of $100 million 
or more. The proposed rule will not cause any significant costs to 
lessees or operators. The only costs will be the purchase of the new 
document and revisions to some operating procedures. The revisions to 
operating procedures will actually result in significant costs savings, 
in that manufacturers of SSSVs will not incur the costs of a 
requalification test every 3 years.
    (b) Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions.
    (c) Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
United States-based enterprises to compete with foreign-based 
enterprises.

Federalism (Executive Order 13132)

    According to Executive Order 13132, this rule does not have 
Federalism implications. The rule does not substantially and directly 
affect the relationship between the Federal and State governments 
because it concerns the manufacturing requirements for specific 
equipment used in offshore oil and gas wells. The rule only affects 
manufacturers and users of such equipment. This rule does not impose 
costs on States or localities, as it only affects manufacturers and 
users of specific equipment used in offshore oil and gas wells.

Takings Implication Assessment (Executive Order 12630)

    According to Executive Order 12630, this rule does not have 
significant Takings Implications. MMS determined this rule does not 
represent a governmental action capable of interference with 
constitutionally protected property rights. Thus, a Takings 
Implications Assessment is not required under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights.

Civil Justice Reform (Executive Order 12988)

    According to Executive Order 12988, the Office of the Solicitor has 
determined that this rule does not unduly burden the judicial system 
and

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meets the requirements of sections 3(a) and 3(b)(2) of the Order.

National Environmental Policy Act (NEPA) of 1969

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed statement 
under the NEPA is not required.

Paperwork Reduction Act of 1995

    There are no information collection requirements associated with 
this rule.

Unfunded Mandates Reform Act (UMRA) of 1995

    This rule does not impose an unfunded mandate on State, local, and 
tribal governments or the private sector of more than $100 million per 
year. The rule does not have a significant or unique effect on State, 
local, or tribal governments or the private sector. A statement 
containing the information required by the UMRA (2 U.S.C. 1531 et seq.) 
is not required.

List of Subjects in 30 CFR Part 250

    Continental shelf, Environmental impact statements, Environmental 
protection, Government contracts, Incorporation by reference, 
Investigations, Mineral royalties, Oil and gas development and 
production, Oil and gas exploration, Oil and gas reserves, Penalties, 
Pipelines, Public lands--mineral resources, Public lands--rights-of-
way, Reporting and recordkeeping requirements, Sulphur development and 
production, Sulphur exploration, Surety bonds.

    Dated: November 14, 2000.
Sylvia Baca,
Assistant Secretary, Land and Minerals Management.,

    For the reasons stated in the preamble, the Minerals Management 
Service amends 30 CFR part 250 as follows:

PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER 
CONTINENTAL SHELF

    1. The authority citation for 30 CFR part 250 continues to read as 
follows:

    Authority: 43 U.S.C. 1331, et seq.

    2. In Sec. 250.198, in the table in paragraph (e), the entry for 
``API Spec 14A'' is revised to read as follows:


Sec. 250.198  Documents incorporated by reference.

* * * * *
    (e) * * *

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         Title of documents              Incorporated by  reference at
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 *                  *                  *                  *
                   *                  *                  *
API Spec 14A, Tenth Edition,          Sec.  250.806(a)(3).
 November 2000, ISO10432:1999,
 Petroleum and Natural Gas
 Industries--Downhole Equipment--
 Subsurface Safety Valve Equipment,
 API Stock No. G14A09.
 
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    3. In Sec. 250.806, the last sentence in paragraph (a)(3) is 
revised and new paragraph (a)(4) is added to read as follows:


Sec. 250.806  Safety and pollution prevention equipment quality 
assurance requirements.

    (a) * * *
    (3) * * * All SSSVs must meet the technical specifications of API 
Specification 14A.
    (4) For information on all standards mentioned in this section, see 
Sec. 250.198.
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[FR Doc. 00-30694 Filed 12-7-00; 8:45 am]
BILLING CODE 4310-MR-U